Weekly Column #5: "Disrupters"? The Real Estate Tech Revolution
By Kristi Waterworth
While everybody else was busy focusing on interest rates and new housing trends, something sort of unbelievable happened--a whole bunch of real estate-related startups popped up and started changing the way people manage their home purchases from the moment they decide to apply for a loan and well beyond the closing table...
No, really, it’s true.
Startups Gotta Startup
According to Crunchbase, startups in the residential real estate sector raised a total of $532 million in the first half of 2018, a figure that far surpasses all of the money raised for fledgling real estate-related businesses in 2017. Companies like Opendoor, GreenSky and Reali are just a few names that have gone public or opened new investment rounds to incredible fanfare this year.
Even the companies that haven’t gone public yet are definitely in the “to watch” category if you’re buying, selling or need help sometime in between. The writer at Crunchbase is quick to point out how these companies are disrupting the way real estate has been done traditionally.
And I can agree with this to some extent, but from where I sit, it looks more like these are tools to make everything easier for agents, brokers, buyers, and sellers, no matter what those people look like. Disrupting feels like a strong word--I’d go with “improving.”
Tech Revolutions in Real Estate
I was a licensed Realtor from 1998 until the market collapsed in 2007. During that time, I was witness to an ever-forward moving marriage of real estate sales with technology. First, we got a very basic online database where a person could look up photos of homes for sale and print out detail sheets for clients. It was an amazing upgrade from the old listing catalogs.
The Blackberries that could open lockboxes (the boxes on houses for sale that hold the key) were complete miracles. People ran around my office like kids on Christmas beaming contact information between Palm Pilots when they were the thing. My Pocket PC was the first device for our team that had internet browsing capabilities. These were very exciting times. They could have been considered to be disruptive, too. After all, each one completely changed the way that realtors did business.
The point is that today’s tech revolution is not an event occurring in a vacuum. That doesn’t make it less significant, though--not by a longshot. The main difference between this round and those prior is that the audience now is real estate customers--buyers and sellers like you--instead of pros that are the inspiration behind many of the most successful innovations of the past.
Interview with a Real Estate Tech Startup
I thought it would be interesting to answer the Crunchbase article with some face time with someone with a real life stake in current real estate tech trends. Rob Morelli, CEO and Co-Founder of HomeKeepr, a community that focuses on connecting people with service professionals of every variety. HomeKeepr isn’t just another Angie’s List or Home Advisor. Instead, the community is focused on people helping one another find professionals they can count on.
For example, if you discovered a leak in your plumbing a year into owning your home, you might feel pretty alone and like you have no way to know which plumber is best. If you have a free HomeKeepr account, you can simply pop in to see if your Realtor has already recommended a plumber for other clients. In a situation where an agent doesn’t have a specific recommendation, you can always ask them with the click of a button.
It’s a little like asking your friends for advice, but instead, you have a whole community to pass around those recommendations, making it easier than ever to trust strangers working in your home.
“Right now, only about ten percent of all home services transactions take place online,” Morelli explained to me. “The rest happen offline — primarily through word of mouth. HomeKeepr is replicating what is happening in the real world, only better because we capturing these word of mouth referrals and making them discoverable again and again.
We’re the only marketplace for home services that is powered entirely by real referrals from real people — and that’s what consumers really want. Because we provide referrals from real people and not anonymous reviews, someone has put their own reputation on the line to recommend the people you find on HomeKeepr.”
Morelli says he was moved to create HomeKeepr because of his own experiences buying a home. The first time something went wrong, he had no idea who to call for help. To make matters worse, the only person he knew nearby was his Realtor. Lucky for him, she had a list of service providers that she liked to work with. That sparked something in his brain, and that something became HomeKeepr. Now people can go online using their desktop or mobile device and find the service pro they need fast.
Nothing could be easier. This is real estate tech. This is how it should work to make life easier for everyone.
Tech Startups, Realtors and You
While I wouldn’t go as far as to call any of this tech “disrupting,” I will say that they can be incredibly valuable to any and all buyers, sellers and homeowners. These tools put more people in control of their own real estate experience. Having a way to catch up or be on the level with real estate sector pros is probably the most vital contribution tech startups have added to every transaction.